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Presidio's Paul Boscacci: Advent has just been a little arrogant in their approach, but they’re changing that.

By Brooke Southall

In a head-turning victory after a string of successes, Black Diamond Performance Reporting has won the business of a $4-billion RIA, Presidio Financial Partners LLC, that is about to launch a nationwide expansion campaign.

The Jacksonville, Fla.-based software maker won Presidio’s business right in the backyard of the incumbent software company and a principal adversary for the account – San Francisco-based Advent Software.

Presidio, which expects to complete its conversion to BlueSky portfolio management within a year, has been beefing up its management team and systems to prepare for a push to add offices in various cities, make acquisitions and poach wirehouse brokers. See: Mark Palmer departs Cetera and joins big West Coast RIA.

High-level Involvement

Reed Colley, CEO of Black Diamond, and Dave Welling, chief solutions officer of the firm, made trips from Florida to nail down the business. Peter Hess, presidcent of Advent Software, whose offices are several blocks away from Presidio’s headquarters at 600 Townsend Street in San Francisco, also pitched in to the negotiations on behalf of his firm, according to Presidio executives.

Reed Colley visited San Francisco for the $4 billion account.

Black Diamond has been seen as the David to Advent’s Goliath in many instances in the past couple years as it takes on the market leader for bigger and bigger swaths of business, though it was founded only in 2003 by a 26-year-old Colley. Black Diamond has made a name by framing its offering as an “online solution” as opposed to Advent Axys, which is a desktop solution.

Yet after two or three years of mulling technical details of the various vendors, Presidio gave Black Diamond the nod based on a more holistic vetting process, according to Paul Boscacci, head of wealth management operations for Presidio.

“It becomes more of an emotional fit, and who is going to be your partner for a long time. What’s our compatibility going forward? (At Black Diamond) they talk like investment people. There are technology firms that don’t understand the business. At Black Diamond, we found a blend of the two.”

Brodie L. Cobb, Presidio’s founder and CEO, added in a statement: “They bring the same entrepreneurial motivation to their business that drives ours.”

The Presidio executives said they were wary of choosing a small firm that could become shark bait. Black Diamond — with $70 billion of assets now managed with its technology — has young management and critical mass.

“We wanted to make sure they’ll be around and not get bought by Advent,”’ he says.

Boscacci did not say what Colley said to convince him that Black Diamond isn’t grooming itself for a sale to the industry leader but Boscacci has experience in vetting new portfolio management systems on behalf of New York City-based Offit Capital Advisors where he was a founding partner,

One helpful factor in building rapport between the two firms was that Presidio hired Mark Palmer, a former managing director at Schwab, in November. He and Welling, who also left Schwab relatively recently, established immediate trust, according to both sides. The deal between Black Diamond and Presidio went from introduction to closing in less than two months – starting in December and closing in late January.

Still, there were things about the attitude of the Advent sales team that played in the decision.

“We had some very good conversations with Pete Hess and they have a good product. They’ve just been a little arrogant in their approach, but they’re changing that,” Boscacci says.

Hess declined to respond to questions directly surrounding the suggestion that his company has a streak of arrogance – voiced to me by other advisors over the years and more recently – but he says in an email that he respects the decision made by the Presidio executives.

Graceful In Defeat

“We’re sorry to lose Presidio as a client, but respect their decision and will be as accommodating as possible through their transition. Advent continues to be the platform of choice for wealth managers of all sizes and sophistication levels and we’ll continue to work hard to meet the challenges of our competition.”

Peter Hess: We're sorry to lose Presidio as a client.

Black Diamond clearly intends to be that competition, with two or three key technological selling points.

In the case of Presidio, using Blue Sky has freed up the time of three of its employees who were formerly focused on data reconciliation, Boscacci says.

IPad Factor

Black Diamond also showed Presidio executives how it has brought BlueSky to mobile devices.

Another technical advantage that Black Diamond demonstrated was its ability to report the performance of separate account managers – a focus at Presidio.

Black Diamond allows the separate account to be viewed as a distinct holding, like a mutual fund, rather than shown as all of its underlying holdings. That view is also available with Black Diamond; RIAs can toggle back and forth with a click between these two viewing options.